I've thought about this for a few months now, since you first posted this seminal essay.

I don't believe in 'problems' and I don't believe in those who 'endlessly talk about problems' -- I believe in solutions.

(Not that you're one of those who endlessly talk about problems, Joe. Your elucidation of 'the problems' helps us to fully understand -- and your proposals are slightly ahead of our time)

Therefore, and thank you for laying it out for us so perfectly;

What we NEED to do, in order to ACTUALLY fix this set of problems:

1) Re-institute a revised military draft.

What?

Yes, it's not like we're going to war, or that we're likely to start a new war.

Each young person should be required to serve one year (their gap year) either as a young cadet (between junior high school and senior high school) or at a slightly older age (between senior high and college) or even older (between college and first year university) and they are free to choose the time they at which they serve their compulsory military service, as long as they complete their service, by age 25.

Maybe the ACoE could partner-up with Habitat for Humanity so that these kids could get some hands-on experience and see realworld problems and solutions, firsthand.

In addition to the benefit I've noted above -- with significant numbers of students fulfilling their 'gap year' responsibilities to the military, it leaves that many fewer students to compete for the same jobs or internships.

Which will obviously drive up demand for those students, and thereby drive up their wages -- thereby making demand for their employment comparable to the demand experienced by their parents' generation.

Problem #1 solved.

Not only would these kids learn valuable skills, they would form lifelong friendships and have the opportunity to meet other kids from all parts of the country/all walks of life.

And a real shot at a quality job with decent pay, once they complete their schooling.

2) We've seen that kids with lower levels of education, tend to remain their entire lives with that same low level of education. (They will always work at a blue collar job) And never have a real opportunity to move into a higher economic quintile.

But we've also seen hundreds of thousands of kids with college degrees working at menial jobs -- and just happy to have ANY job.

I 'solved' the problem of too much competition in the student and post-student job market in my point #1 above, so what is left, but to ensure that each student has the opportunity to gain a one-college-degree-education, so that they may have a real shot at moving up by (at least) one economic quintile.

How to pay for that?

I think when a young person serves in the military for their one-compulsory-year military service, that should entitle them to one, no-cost-to-them college degree.

It's so simple!

Serve one year compulsory military service in good order and gain a free college degree!

And while you're doing that, rest assured that once you enter the job market, not only will you have more marketable skills and experience, you will notice a wide-open job market for your demographic, as other students will be away, serving *their* compulsory yearlong military service.

3) For today's students overburdened by student loan debt, they should likewise be invited to serve one year in the military, in order to 'work 0ff' some portion of their existing student debt via their one-year-compulsory military service. Let's say to a maximum of $36,000.

For some students, this may represent only half of their total student loan debt, but for as long as they remain unemployed, that debt is going nowhere. If they want to drop their total student loan debt by $36,000. all they need to do, is apply to the US military under the student draft.

Of course, the military may not need all those people. But there is crumbling infrastructure all over America that needs low-cost labour to bring it back up to standard. And there is plenty of planned infrastructure that needs building and low cost labour, just waiting to be built.

What could be cheaper than hiring the Army Corps of Engineers partially staffed with student labour?

To solve housing shortages for the bottom quintile in America, what is better than thousands, or tens of thousands of young, bright, energetic students seconded from the US military, to build those housing units?

Not that the students will earn a wage while working in the military, but they won't have to pay rent for one year -- as the military will house them. Nor will they have to pay for food or clothing -- as the military pays for all of that. Nor will they have to pay for medical or dental or injury issues -- as the military routinely pays for all of that, and more. In short, the student cadets will have zero expenses and will be fed, housed, clothed, and have their medical needs taken care of.

How to pay for all of this?

Well, it's cheaper than you could imagine.

There are no labour costs.
And corporations and various levels of governments could cover the costs.

However, the military may require (only) a 5% increase in their annual budget.

However, it would be worth double or triple that, in order to solve all of the social problems of the student and post-student cohorts!

During their military service, the military is 100% responsible for these people, but via all of the cost savings from national and state infrastructure spending (no labour cost for student workers!) and other projects where the military can direct student workers, the students will more-than pay for their upkeep by the military.

Not only that, but some corporations may want to sponsor work-teams to beautify certain parts of their city where they can place a plaque (ABC company paid for this beautification project in downtown Fresno) or at or near their corporate headquarters -- via tree-planting programmes, or what-have-you.

Free labour for infrastructure projects, higher demand/lower unemployment levels for students/student debt lowering or elimination for those with existing student loans and and higher wages for (suddenly) higher demand interns and students.

Sweden, Israel and a few other countries have partial or modified versions of this programme, so it's not like it couldn't be done.

Thank you Professor Stiglitz for a informative assessment of the new ideas that are emerging to change the landscape of how we live today. As a 56 year old adult that is back at University I can safely say I'm with the young people 100%. What the west has built is crumbling before us via the 80% serving the 20%.. which suffice to say is Not Working and Will Never work. Anarchy is looking like a viable 3rd Political party at this point in our evolution since the root of this system is corrupt and has subjugated us to economic slavery. Many of my 50 something colleagues have stopped... doing anything... which is a natural response to the extreme low pay of the workplace of today. This is unsustainable and will slowly decay into more and more extreme poverty. Fully 50% of the children in the united States now live at in or near poverty conditions.. which means we are dying as a nation. Sweet land of liberty has tuned into demoralizing destitution.

This article brought a smile to my face. After telling us that the elites have let us down, the aurhor's solution is to suggest that we adopt more elite run policies and have more transfer programs (free college for all) that will plainly not help the cause of economic growth, which I agree is the best (perhaps only) way out of our current situation. On that score, the two democrats have little to say that would be helpful.

The US has experienced economic growth since 2009, but the real issue is who benefited from this increase in GDP. Much of the increase in "employment" is due to the measure of 15 hours of work in the past week. Much of the employed are working in positions for which they are underutilized relative to their acquired skills - and paid accordingly.

Bill Clinton recently called Se. Sanders as the "champion of all things small and the enemy of all things big." One can surmise with accuracy that this statement reflects the outlook and values of the respective campaigns, and leads to a conclusion that should be obvious to Prof. Stiglitz and to all other economists and policy analysts who presume to call themselves liberal or progressive, namely that there is a world of difference in the policy priorities between Sanders and Clinton.

I am not a Trump fan, but Stiglitz writes as if Sanders and Clinton are the only reliable choices voters have. True, the Republicans' most talented and capable candidates dropped out and left us with its least desirable (Trump and Cruz), but millions of Americans - some of them disgruntled Democrats and many younger people - are flocking to them. Republicans are voting in higher numbers in primaries than are Democrats.

So what are the choices of young people in November 2016 - a raging beast with no real agenda or a woman dragging decades of baggage - including that sort-of husband who has humiliated her for decades and a rap sheet that includes furniture stolen from the White House to unanswered questions about her foundation, her mediocre stint as Secretary of State, emails and ... what else is to come?

To J.B. Borne:
I suppose it was too much to hope that this site, which I treasure for its intelligent and wide-ranging discussions, would forever remain a troll-free zone. I have followed US politics for most of my life, and cannot remember ever seeing the kind of lies and misinformation being spread about one woman, of which your screed, straight out of the right-wing noise machine, is only the latest example. So far as I have been able to determine, the only "baggage" Mrs. Clinton is carrying is the same she has always had to carry: the unreasoning hatred and mendacity of those trying to destroy her. No, she and her husband did not steal furniture on their way out of the White House in 2001, a finding confirmed by the Bush administration's own investigation. No, there are no unanswered questions about the Clinton Foundation; the book on which those allegations are based is full of misstatements of fact, if not outright lies. No, she did not illegally use emails as Secretary of State; every one of her predecessors, from the time emails started to be used for intergovernmental communications, did exactly the same thing she did, with no questions raised as to the correctness of their actions. Finally, to date, Mrs. Clinton has received more votes in the primaries than any candidate of either party. Sanders and Clinton have sharp disagreements on issues, but at least they are discussing those disagreements as adults, not raging egomaniacs. As to who has the better ideas among all the candidates still running in either party, I'll take Professor Stiglitz's opinion any day of the week.

Younger people in the U.S. are smart enough to see that they have been failed by elected officials in D.C. Many perceive that the government is not their keeper and that life is about decisions they make early on. The college loan situation is an excellent example. Young people are so strapped they can't afford to marry and buy homes.
Failed institutions, indifferent politicians and a government that has become bloated to the point it is dysfunctional is what younger Americans see. There are jobs available, but many are unprepared for them because they didn't even finish high school. Add to this - now about 50% of Americans no longer pay income taxes. And who will make up this stunning difference? Just a wild guess - the middle class.

{Today’s young university graduates are burdened with debt – the poorer they are, the more they owe. So they do not ask what job they would like; they simply ask what job will enable them to pay their college loans, which often will burden them for 20 years or more. Likewise, buying a home is a distant dream.}

Indeed, but let's consider "why?" as depicted in this infographic from the OECD: http://www.oecd-ilibrary.org/education/spending-on-tertiary-education/indicator/english_a3523185-en - compared to other OECD countries the US spending upon Tertiary Education is 65% "private" and 35% "public".

Were the US to consider Tertiary Education as it does Primary/Secondary schooling, then it would be as nearly free, gratis and for nothing as humanly possible. The money thus spent on investing in the future competencies/skills of a Tertiary Education (vocational, 2- or 4-year) would more than offset the future expenditures of Unemployment Insurance disbursements ...

{If socialism means creating a society where shared concerns are not given short shrift – where people care about other people and the environment in which they live – so be it. }

True enough, but let's emphasize the difference between the dictionary definitions of "socialism" and that of "social democracy" (according to Bernie).

The former means the ownership of the means of production and the latter does not, with an emphasis in social-democracy upon the sharing equitably of the income (that become wealth). The studies of Piketty have shown how unfair and inequitable is the US in that matter.

But fairness, though many are upset that it does not exist, does not seem to be the main claim of our youth today. After the Great Recession, now not quite fully recovered, has left a remembrance this generation will easily forget. Particularly in Europe where unemployment has been far more difficult for far longer.

I live in France - which has not known an unemployment rate below 7% since François Mitterand in the 1990s; that's a quarter of a century ago. Imagine the permanent damage that can do to mindsets. Of course, the French are wholly to blame for not having corrected a faulty regulatory regime as regards employment that exists since long before 1990.

Unlike the US, the EU problem is more regulatory in nature - the emphasis has been on "protecting" workers from unemployment, rather less than promoting employment creation ...

I will say many of the posts in this column are as lamentable as the article that spawned them. Although Mr. Stiglitz is partially correct: 'The lives of both old and young, as they are now lived, are different. Their pasts are different...'. Their prospects are different but subject to the same facts as their parents- hard work, frugality, honor and truthfulness, responsibility and guts will make the difference.

My wife and I worked very hard to get three kids through schools, paying double to do it. The public schools around here are fair to good, but I'm still appalled at the ignorance of the graduates. We sacrificed to get our kids through private schools and it helped. The oldest daughter is brilliant, but autistic to a fair degree. She flunked out of college bet met an amicable lifemate who works as a contract programmer for a university. Not a glorious salary, but they live on a cash basis with no debt and a substantial savings/investment plan. The son went to Iraq in the Marines, flunked out of college but managed to learn CAD/CAM while there. He turned his life around one weekend when he found out his illegitimate son was wandering the street naked at 2yrs old. He moved across the country to help raise his son, got a job as a maintainence clerk but soon moved up when he wrote programs to automate the maintainence records and in his spare time started using his CAD skills to design repair parts and get them made for locally for 1/3 the cost of factory spares. He's now making as much as i did(adj. for inflation) at the same point. The youngest daughter got 3.97/4 grades in college, 2nd in her class. Two months out of school she got a temporary job as a clerk/typist. Within two months she got hired full time for writing spreadsheets to automate weekly reports(a financial services company), got moved to Oregon for even more money. She quit in disgust of the company for trying to cut its way to profits during the Great Recession and got herself a job making twice what I made at a similar stage with a financial management consulting company. They hired her full time at her asking salary. This year.
The point is, none of these three had their world handed to them on a platter. They've worked hard to earn what they've got and seem to have the flexibility to change when they have to.

The problem I see for many younger people is that they were shortchanged by their parents who learned bad parenting skills. Shortchanged by the educational system with its continual dumbing down, overweight bureacracy, and miserable policies. They've also been burdened with overweening government at the state and national levels placing undue burdens on potential employers and simply throwing money at colleges and universities that have made startling increases in college costs with no concurrent improvements in education.
And to throw one at JoeyJay, we have a black couple across the street that have been working their butts off to get 5 boys through the local schools with discipline, integrity and ambition intact. They have made their own life, not accepted the one behind black lives matter.

Joseph E. Stiglitz points out that a "great divide" has been created in recent years, which is "based not so much on income, education, or gender as on the voters’ generation." Young people on both sides of the Atlantic are rallying behind silver-haired socialists like Bernie Sanders and Jeremy Corbyn in Britain, who find themselves being idolised as the standard-bearers of a new leftwing movement, railing against inequality and the political establishment. Few outside of politics had heard of them a year ago, but both enjoy a meteoric rise.
The Cold War ended with the fall of Communism in Eastern Europe in 1991. Many of those who support Sanders and Corbyn were either children or they weren't born yet. For this Generation Y, "socialism" has a different meaning than for the baby boomers, many of whom had witnessed its "failed experiments". If millennials think socialism means "creating a society where shared concerns are not given short shrift – where people care about other people and the environment in which they live – so be it." Stiglitz says "today’s experiments bear no resemblance to those of the past. So the failure of those past experiments says nothing about the new ones."
It is true that "older upper-middle-class Americans and Europeans have had a good life." Employment opportunities and job security were never a problem in early days. Now millennials face much tougher challenges than baby boomers. Two women met for a cup of tea. One is never offline; the other finds technology a drag. The 28-year-old couldn't help but felt a "stab of envy" to see what the 73-year-old could afford. While the millennial is struggling to reimburse student loans, she realises that she would most unlikely be able to own her home and car, like her counterpart does.
Stiglitz says, "today’s young people view the world through the lens of intergenerational fairness." Although members of the "upper middle class may do well in the end," thanks to inherited wealth, much of what "was once viewed as a basic middle-class lifestyle" can no longer be taken for granted. He sees "three realities – social injustice on an unprecedented scale, massive inequities, and a loss of trust in elites – that "define our political moment," which sees the loss of "center-left and center-right parties in Europe." In America, fortunately the two "Democratic candidates are proposing changes which – if they could only get them through Congress – would make a real difference."
The author believes that there has to be a "financial system" which advances "intergenerational justice." This would prevent people from plunging into poverty, and help finance higher education, without individuals digging deep into the pockets. He believes that "more needs to be done to make home ownership possible not just for those" with rich parents, and to make "retirement security possible, given the vagaries of the stock market and the near-zero-interest." Indeed, young people "will not find a smooth path into the job market unless the economy is performing much better." Pensions that were promised in the past and seemed ordinary at the time are hurting the millennials, who will be paying the price for baby boomers' pensions.

I thought I was a run-of-the-mill old timer. Age 90 and from a low income poorly educated family, I volunteered for the Navy's lowest rank in World War 2, departed five years later as a LT(jg). Then I became an international development economist. I too am worried about the three realities facing millennials and try to help in any way I can (for example, by campaigning for Bernie, although I am somewhat to his left -- concerned more by concentration of automation and its impact on jobs, just when we are approaching that Nirvana that humans hoped would free us from work. But you say my generation doesn't think like today's, that it doesn't recognize the problem that our young do? Surely I am not alone, and you aren't either (although you aren't as old as I am). I think our numbers are substantial, judging from the folks I hang out with, who are also concerned about social injustice, massive inequities (especially black/white) and failure of the wealthy and of Congress to pull us out of the mess they have, for the most part, created. WE are born-again activists, seeking ways to be most effective. Who is our leader?

One of the big reasons 85% of under 35 year olds are for Bernie Sanders is that they seen their parents lose their jobs and their houses in this economy... things they worked a lifetime for!. My observation these last 35+ years has has been continual decline because wages have not budged (inflation adjusted) and that makes the only way to survive adequately is with debt compensating for the loss of buying power. We still, to this day, have not systemically changed a thing! ...which to me is incomprehensibly stupid!

Bernie Sanders is the only one that can take the situation and start addressing the problems. It will take another 20 years before it can get some thing fixed.
Clinton is part of the oligarchy and so is Trump.

We need someone like FDR, and Sanders isn't it. FDR was part of the oligarchy of the time too - much more so than Hoover - but it took someone who was a member of the wealthy class to call them on their rent-seeking and change things.

You meant to characterize white middle class boomers. We non-whites are not included, with few exceptions. Now all ethinic background are going to experience what non-whites from African Americans and Latinos have experienced together with American Indigenous people...poverty and struggles.

One: "They may have made more on capital gains on their homes than from working." Joe - very sloppy economics. Let's leave the empirical-free world to Trump. Or prove the statement (which you can't).
Two: "Yes, there may have been failed experiments under that rubric [socialism] a quarter- or half-century ago..." What an understatement.
The west needs a new social contract where the rewards of improved technology, efficiency and scale are shared among all citizens, not just the elite Silicon Valley t-shirt guys or the the Wall Street suits. But that isn't socialism (ownership of the means of production by the state). Let's get things right, please.

Stiglitz lost me when he said that Hillary and Bernie have solutions that would make things better, especially when compared to the Republicans. This article needed a trigger word warning , "paid political announcement". Hillary is owned by Wall Street, so I don't know what she will really change. They support her precisely to present the illusion of change while maintaining the status quo and claiming the moral high ground. Bernie can't figure out how to pay for his programs. It isn't a question of socialism, it is a question of social contract. The left is universalist and hence will try to make things better for our young people while undermining the social and economic infrastructure with unlimited immigration , low cost labor, and inadequate protection of technologies, information and job security. Good luck with that.

The left is also anti white, anti male, anti semitic and anti a lot of other things too. How will that square with unifying people and developing a consensus. This article is a cleverly structured deception.

Sorry for my typos there's no edit button. Hope you can understand my post regardless. Reagan and Thatcher started the neo-liberal lies and it's literally all I've known in my lifetime. I'm now free of it and the world makes more sense. I hope others can see the light. Thankfully even Greenspan who was wrong in many things understood how money really works and let the unemployment level drop below what the models say is full employment around 5%. That leaves around 15% under and unemployed which is a huge waste of available resources not to mention all the social issues that go with lack of opportunity, purpose and wages to live on.

Joel, you are mostly correct until you say loaded and incorrect neo-liberal nonsense like Berbie can't work out how to pay for his programs. How on earth can a monetary sovereign government like the USA not afford any expense in its own currency? Inflation is the limit to spending not the deficit amount. You've been conned and brainwashed since the 80s and need de-programming.

Then if interested Watch this 3 min clip explaining how taxes don't fund government and how modern money really works: http://youtu.be/bTZGU9s0idM

Government spending needs to build the foundations of the economy like education and infrastructure or the whole thing will collapse! The government is not fiscally constrained like a household!! We need our politicians to invest in our future and stop lying to us about needing to keep cutting the things that are essential for the future!

Why is a government deficit which is a private sector surplus an issue? Inflation and real resources like labour are the limit to government spending not imaginary debts in our own currency. We are monetary sovereign and our government isn't a household. We have a fiat floating money now not gold backed or pegged to anyone else's currencies.

If you're really keen to learn more about modern monetary theory (MMT) then watch this longer clip by Australian economist Bill Mitchell on his blog: http://bilbo.economicoutlook.net/blog/?p=32070 to realise why governments don't have budgets like households.

Socialism today not only is failing the majority of the population in the U.S. but echoes the failed regimes of a quarter-or half century ago. The Federal government spies on its own citizens, kills with drones without accountability all around the world, proliferates a system of political corruption, and concentrates power/wealth. I find it dangerous when 'thought leaders' advocate for such a system and presidential candidates that want to continue failed policy. Bernie wants to in-debt the nation further (until it blows up in our face) and Hilary is the prime example of the corrupt political establishment. Why is it the Clinton Foundation isn't under investigation for the donations given by corporations for Hilary's "pay-to-play" policy?

Which brings me to the authors statement: "The sense of social injustice – that the economic game is rigged – is enhanced as they see the bankers who brought on the financial crisis, the cause of the economy’s continuing malaise" The government had an implicit role in the housing crisis just as it does today in creating excess student debt. In the 90s the Fed Government changed the Community Reinvestment Act so banks were forced to lend to poor areas thus creating excess risk. The same thing is happening today with student debt with the tag 'you must go to college for a fair shot at life', except the government has made sure you can't default on your student loans. Now over regulation by the Federal government has caused lending to be tight and thus contributed to the economic malaise.

I agree younger generations are voting differently and those that have educated themselves enough recognize the system is broken. We elected the current president on the 'hope' things would change, however, it seems promises were forgotten. As the wealth gap grows, the environment deteriorates and people lose faith in their leaders there will be more 'radical behavior' as the U.S. declines.

Greg I ask you one question. How do you expect to have a well educated workforce to serve you in retirement (because that's the reality unless you have mass immigration of internationally educated people = theft from their usually 3rd world countries prosperity) when their debts for that education will mean they can't even join a middle class lifestyle until much closer to retirement? It's a ponzu scheme. Education needs to be either free or very cheap or yours and your countries future prosperity is being stolen from right now. The government deficit isn't theft from the future. Not educating future workers property, building necessary infrastructure and keeping our planet healthy and sustainable are the real theft from the future and the real limits to humanities prosperity. Once you realise that everything becomes much clearer.

I highly recommend starting with this this to help deprogram neo-liberal economic lies which Stiglitz respectfully also hasn't fully realised: http://declass3.com/2015/09/18/this-bernie-sanders-appointee-has-proposed-an-elr-so-who-is-she-and-what-is-that/

Over regulation is not the problem. Under regulation is, starting with the asinine idea that the economy of any country should be developed largely for the benefit of those who control capital. It is also nonsense to expect to be able to compete in the production of goods and services, needed by any civil society , when the competition pays the kind of wages paid in countries such as those in the Far East.

The capitalist economy is the best system that mankind has come up with to develop and operate an economy, but every nation should develop their economy ,first and foremost, for the prime benefit of all of it's citizens, and that economy must distribute the benefits produce by that economy much more fairly than has been the habit in the past. Additionally, the economy must be protected to ensure it continues to operate fairly.

Disagree. The happy older cohort through their pursuit of security - economic, social, environmental, even lately cultural validation - have directly caused all the borrowing spending promising taxing litigating and regulating that has destroyed progress prosperity and opportunity. Security and progress quite simply are not compatible.

Interesting and to the point -- although nothing original -- until the author concludes all Republicans are demagogues and the 2 Democrats are constructive. If you are a Democrat you like it, if you are a Republican you thrash it. Would be great to have impartial authors.

A judge or the members of a jury are required to be "impartial" at the beginning of a trial, but that does not require them to remain impartial after hearing and seeing the evidence.

Thus, when the candidates of one party ignore a problem or compete to make the problem worse while the candidates of the other party discuss the problem and suggest possible ways to solve it (regardless of whether their suggestions would be effective), reciting that fact doesn't mean that one isn't, or wasn't initially, impartial.

Stiglitz is absolutely correct in this cursory assessment.
If the assessment, especially for the USA, is analyzed for racial segments, the results of analysis would be far more alarming.

Without the melodrama, the generation born since 1960 need to be cognizant of each person's potential productivity, social accountability and the system of societal rewards and punishments, according to this simple rule.

Social revolution that Stiglitz is implying is the recognition by this post 1960's born generation that there are such differences for each one with respect to this societal contribution. But the real societal revolution can occur, when this generation recognizes that as human beings, on this earth maybe 70-80 years, that they live, study, multiply, produce, consume and leave a legacy as individuals and as societies, making sure that each person is assured of a dignified life style, irrespective of income, racial and cultural background.

Stiglitz writes: “We won’t be able to fix the problem if we don’t recognize it”

Yes Professor Stiglitz, indeed, and so start realizing that today’s credit risk adverse regulators prey on that risk taking the young need for them to have a decent future.

As a result banks do not finance the “riskier” future, they only refinance the, for the time being, “safer” past.

Of course there is intergenerationl injustice. We baby-boomers have imposed a reverse mortgage on the economy, which will extract from it most of its value, leaving little for those coming after. Shame on us!

Voters from the left to the right, we've all been had. The two wings of the "Property Party" (coined by Gore Vidal) have betrayed us.
Voters, stop bickering. Read this article on Salon before forming your opinion on your fav party/candidate -

Free trade has brought a windfall for companies using cheap labor abroad to the detriment of labor in this country. These companies with money be held abroad should bring it back, tax free, by donating it to education and infrastructure here in America. It would be the right thing to do.

How much of the commitments made by both are political pandering vs. evolution of concrete policy framework? Are there not vested political interests that would block or at least water down these proposals.

Professor Stiglitz is on the money, but leaves out a major debt us oldsters have been racking up for youngsters to pay off: climate change
Humanity has known for decades that we couldn't keep pumping CO2 into the atmosphere without creating massive burdens on future generations.
The longer we wait to invest in a transition to renewable energy, the higher the cost will be as our children frantically try to make up for lost time later.
The GOP deserves the lion's share of the blame, but how many of us can say we made a real effort to call out the denial and insist on aggressively protecting our most critical infrastructure asset: Earth?

Michael Public MAR 17, 2016- Neil, you really need to get educated about the climate. It's been changing daily for millions of years. The only thing sure about the weather(climate is the recent average weather) is that it will be different in a couple of days than it is now.
The discussion of anthropogenic climate change, the only one we can do anything about, has been politicized by the United Nations since 1988 with a specific goal of only studying humankind's effects on the climate. They NEVER studied or reported on the natural climate. The result was 100's of billions spent on unproveable theories and wild extrapolations for the purpose of controlling resources and development internationally.

One only has to look at the billions spent jet-setting thousands of people around the world many times a year to posh resort sites and attractive tourist venues for never ending conferences to see the hypocrisy involved.

Mark if you mean all the emissions the west moved to the east (China et al) then you're correct. Everything the west buys from those countries should be counted as their own emissions because that is the reality of the situation. Do you agree?

Climate change is, indeed, a large debt created by our generation and preceding generations that will have to be paid by the current and future generations.

However, while I agree that the GOP primarily is to blame for delay on the part of the US in addressing climate change, it cannot be blamed for the failure of other countries timely to address the problem of climate change.

Well, I'd say prof. Stiglitz managed to grasp the issue, but he is really-really far from mentioning its many and disturbing aspects.

The west is, going to become a smaller part of the world economy --increasingly so. Globalization pushes unskilled workers in China and in US to have similar incomes. The race for "a learning society" will not start with austerity and reduction of social state and the current level of education in advanced economies appears not to be adequate at all, by youth unemployment statistics.

In all, not only are the advanced economies losing the fraction of global wealth they had, but also they tend to regress to developing economies --if they haven't already.

The worst part is that, with industrial revolution behind us and technology revolution at hand, demanding more equality is getting out of reach for the broader "working class". Concentration of wealth, increasingly less social mobility and, worse, centralization of knowhow, in "advanced" economies and all over the world, makes it unlikely that the peoples will be able to reclaim their rights. The increasingly abrupt cliff between good income and no income at all, diminishes the possibilities of a change of course. Another crisis will be the final hit. I would give us 10 years, 15 at most.

You are not asking the right questions. The when and who is mentioned clearly in the article --even in the title. If you don't see them, maybe they are outside your neighborhood, not mentioned in your newspapers and, definitely, have other interests in life than you do.

@michael CROCKETT, it is reasonable that it is easy for you to miss the difference of an improving trajectory, compared to a deteriorating one.

To be clear, the younger generation's life or prosperity trajectory is deteriorating, meaning that they start with what their middle-class parents are able to provide. It's also true for up to 30-35 year old people, I believe.

There thrives in the world's backyard, a generation undeservingly over-pampered beyond the economic capabilities and taught to fall back on Governments or Social Security Systems when life falters. Somewhere when I read between the lines of Joseph, it seems that new age folks might as well have to study twice in life, for a second career starting in the 40s or something. It would be pointless to point a finger at 1%, when everybody had a chance in an open world to do what the 1% did to get there from zero back in the past.

With politics suffering from bipolar disorder, and cancer in some countries; the millennials certainly will cut through all times even at the cost of abandoning whatever it takes to cut through towards better days. And when the world will have more millennials in the topmost authorities in Enterprises and Governments; it will be a time worth witnessing. Thanks for sharing this, liked reading it.

Just said that anybody was free to do what they did to get there and are thriving quite successfully, too. :-) Whether it's hard work, or hiring hard workers or whatsoever happens to be a matter of innate wisdom?

The age of millennials has arrived and Mr. Stiglitz gives a glimpse of the major change in the offing.

These millennials will be inheriting $9 Trillion in wealth, that which got created through sacrifice and innovation. But at the same time, they would be inheriting many man-made challenges, climate change is only one of them.

The apparent lack of faith in the existing credo, is apparent, but we can only hope that they can learn the art of sustainability a shade better than our generation did. Then they would leave more for the posterity than we did.

If the real limit; the planet Earths natural systems fail, then there isn't any 'real' wealth. Humans will be but a minor blip in earths history. The earth will carry on without us it doesn't have an opinion.

I am surprised with you. It seems you got nothing from the article, but just said what was in your mind, anyway....

The article is about inequality and the gap between ruling and ruled. There is no such thing as 9 trillion wealth. It's supposed existence is in the 1%, in the form of market value, mostly and with no chance of changing hands, under currently ruling establishment, institutions and deeply centralized knowhow.

The fall will be abrupt and the imaginary 9 trillion will disappear, like the power structures and their concentrated knowhow.

We live today in a World of unregulated Global competition where the rich get richer and the poor stay poor, as highlighted by Piketty. Of course the rich are mainly the older generation from G7 countries, while the poor are mainly the younger generation from around the World.

This is not only very divisive and damaging to society, it is also leading to the stagnation we see in developed economies. Where wealth is directed to young people they spend it - to build homes to invest in businesses, and build a future for themselves and their families, all of which leads to economic growth. But most of our wealth is held by old people who use it to drive up the price of assets including property, stock markets, and gold. This does nothing to help economic growth. Add in declining public spending through austerity, and you have the perfect recipe for stagnation.

We must do better. Only by establishing a "Global Economic Community" can we reshape the Global economy to ensure that the rich pay taxes which can be used to invest in a better future for all our children.

Robert Bruce's comment is the most on target regarding a new "Global Economic Community", but that new 'community' already exists and would more accurately be called the the 'disguised' "Global Capitalist Empire" ---if it were not so well disguised.

This is, as Morris Berman accurately describes in his 2007 "Dark Ages America" the final phase of the first and last truly global Empire --- first in being far more successfully disguised than the Nazi Empire's crude single party Vichy facade, and second in being last, as an Empire which will bring Easter Island style total collapse to the global level.

-A change to laws prohibiting corporations from contributing funds to politicians. Without this, the money controls the power.

- Land is limited resource. Land should be rentable with a lifetime lease. Then it returns to common property - available for lease by whoever is willing to pay the highest rental price for it. This stimulates the flow of capital (i.e. capitalism!) with respect to this.

- a cap to inheritance. Bill Gates will give his kid $10M each. They will be wealthy their entire lives from this.

- Allow government to release capital rather than central banks via fractional lending. These releases are for common assets - roads, internet infrastructure, power plants, universities. I understand the risk of inefficiency and abuse is higher but the general reward is higher too.

- Have a solid safety net for small entrepreneurs. Not sure how it should work but 1% of government expenditure should go this way. This is where value is created but the personal risk is so so high.

and who, Michael Public MAR 17, 2016, is going to write and administer these laws. The same politicized bureacrats who have already published 40,000+++ pages of federal laws and a similar amount of state laws with even larger volumes of regulations to be interpreted and administered?

land isn't a limited resource anymore. Land is only considered valuable because its owned by the establishment.

That's why CAP accounts for 40% of European funds, although agriculture only amounts to less then 5% of the GDP and the workers.

Land has value because it grants subsidies, if not it would be very cheap.

Urban land is scarce because there are artificial laws and regulations that make it a valuable resource. Its how real estate and politicians make money. If the use of the land was free, most of the properties would reduce its value by more then a half.

@MP
"Land is limited resource. Land should be rentable with a lifetime lease."

Now there's a potentially radical idea (i mean that seriously, no irony.)

Actually, Israel has such a system. I suppose it goes back to the more noble socialist and egalitarian roots of the state, in ironic and tragic coexistence with the awful deal the Palestinians got in the process, a contradiction that burns it to the core still. But that's not where i'm going with this - not touching that one with a 40 foot pole, no way.

I'll try to keep it abstract. But it's such an important thing, land ownership. Kind-of the keystone holding up all these issues surrounding property. Ask a property-rights purist in the US if the timbers from which their house is built rightfully belong to the native Americans, and you'll hear them selling you the labor theory of value. They'll hate you forever if you point that out to them.

Or staunch US ally and enemy, Saudi Arabia and Russia, benevolently and malevolently anti-democratic, third and fourth military in the world. So many global tensions revolving around them. What for? To defend tremendous natural resources. Land ownership. Property rights, perhaps?

Nothing to do with generation gap, though. To connect that back, you have to get into how an individual, looking out for our material needs, relates to others via the actions of government, which in turn brings up political identity. Oops out of space. Move out to the country. Much better out here, less need to get hung up on all these hostile feelings.

I think the point Stiglitiz raises here about socialism is important. Old fashioned socialism was a failure because it often suppressed the efforts of individuals. But when it didn't suppress these efforts it worked fine - for example Lenins' New Economic Policy created good results while at the same time in America unrestrained capitalism was causing much harm. Stalin abolished the policy in 1928 and started a slippery slope that ended in the fall of the USSR for economic reasons. While America came to its senses with the new deal that worked wonders until Reagan hoodwinked the public that unrestrained capitalism should return - ending in the events of 2008. I think that right wing people need to stop feeling so threatened by socialist efforts - there a ways socialism can be implemented that does not work against what they hold dear (the freedom of the individual).

We could argues that Scandinavian countries and other countries in Europe are socialists. Most if not all are social democratic, so saying that the regime in place on the places with higher standards of living is a failure is a long stretch...

I raise my hand as a member of the younger generation. I did well at everything and my parents were wealthy enough to give me an advantage over others. I studied hard - qualified as a CPA - did a MBA - landed lucky jobs - was a CFO of a small company - was CEO of another small company - I met every definition of success compared to my peers - and then I took stock of my life - basically I was poor - I could not afford to buy a house that my great uncle (a machine operator) lived in. I could not afford to have a 2nd child. I could not afford to start a business. I could not afford the better schools. I was working 14 hours days making millions for older generation owners who did not even understand the business. And I had no leverage - if I quite a literal hundred applicants will raise their hand. The promise was a lie - and I am angry about it - i'll admit it - half my life chasing a willow-the-wisp.

Michael than you for your honest and frank comments that really get to the main issue. I'm in a similar situation, lucky enough to have savings from my parents help to buy an apartment and then sell it in an overpriced market. I'm now studying an MBA for myself to start my own business hopefully. I consider myself on strike from society in a reverse Ayn-Rand world of the workers being the real point of importance. I wish you the best of luck.

If you live in the USA then Bernie Sanders is really the only politician in this century who will likely change anything. If you don't vote then he can't do the job required. I'm happy to sit back and let Trump destroy the place. They say people need to hit rock bottom before they can change. Trump may be what's required for people to finally wake up. Otherwise humans will be a minor blip on the earths history. I'm fine with that too we aren't as smart collectively as we seem to think we are. One planet in an amazing universe yet we are on a path to destroy its ability to kero us alive. Wow.

How sad! Interestingly, this is a day-to-day reality supposedly top-flying employee faces, however privileged s/he is. The unprivileged fellows are even worse of. Some might say Mike is growing through normal mid-life crisis. Nah, this is not it.

Like Professor Stiglitz noted, this is a crisis that our generation may have to contend with throughout our life time. Inequality is the new normal.

The older generations grew up in a society that boasted about how much better it was than its competitors - it had the rule of law, free speech, trustworthy media and a general belief that "crime does not pay", which was an actual often repeated phrase.

Today's generation lives in a society where stalker gangs openly poison people while the police and government just watch, thus making them accessories; the "media" is composed of many highly questionable outlets; rule of law is frequently ignored - unless you are poor and have no connections; and "crime does not pay" is a phrase never heard and sounds like the punch line to a joke.

The older generation could be inspired by its mileau. Today's generation is cynicized by corruption and failure.
.

Globalization has battered western labour markets.
Globalization has liberated capital mobility.
Until the internal cost structure of China and then India attain western standards, western non-capital incomes will continue to suffer.
So there is probably another thirty plus years of this to come.

The way of 30 or whatever years to "western-style cost structures" is too long. The way to abandoning overconsumption is similarly long and ...there are vultures and markets to create artificial consumption, very efficiently.

Our best chance is to bridge the gap of average people vs centralized institutions knowledge gap --an enormous task-- so the former can demand and mobilize redistribution. The alternative is chaos. The young generation will demolish the current wealth-for-the-1% infrastructure and wars will be necessary because of hanger.

@Micheal
That in a nutshell is the problem. Western lifestyle as it is at the moment is unsustainable and more aspiring to it means it becomes more unsustainable. The only outcome has to be a move downwards away from consumption. That is a problem in a consumer society. As only about 21% of endeavour is required for the basics of survival it points to huge potential overcapicity worldwide. There are signs of a move from physical product consumtion to life experience consumption amongst the younger age group which if it continues will disrupt conventional earning locations

What Mr. Stiglitz said feels true to me. I came to America from Hong Kong in 1971 and became a U.S. citizen in 1987. I am now the "older generation." I had no money when I arrived but I managed to get two graduate degrees without incurring any student loans. There were initial years of brutal struggles for me financially and immigration wise, but I've built a self-created career and a comfortable living. I am thankful. As always, it is best to feel that we are not entitled to anything and to rely on oneself with a little bit of luck and idealism.

That might have worked for you, but think of those that could not leave Hong Kong, or better, those that could not leave South Africa and elsewhere. Do you think they should believe "it is best to feel that we are not entitled to anything and to rely on oneself with a little bit of luck and idealism" ? Isn't that kind of the same for the younger generations? Do you have grand-children?

Profits = (+Net Business Investment - Workers Savings) +
(+Govt Deficit - Trade Deficit).
In the past we had balanced trade with low govt deficits. Today, govt compensates for recurring trade deficits. But why invest in America when you can't compete because of currency manipulation?
The solution is not to prop up another housing bubbles (which compensates for trade deficits again if home equity extraction) but to enforce balanced trade. If done, job security will dramatically rise.

"View/Create comment on this paragraphThat generation expected to have job security, to marry young, to buy a house – perhaps a summer house, too – and finally retire with reasonable security. " - When exactly was that and whom did this apply to?
Graduates of good colleges in in-demand fields such as engineering, finance, medical have unparalleled prospects today, irrespective of family connections and other circumstances.

You are quite right. That wonderful land and time did not exist. I am now very old, in my seventies. In my youth, privileged middle class people like me expected to live very well, but they were a small minority. Most people were paid derisory wages in comparison, and managed to struggle to buy a house and raise their children. Many of them lived in state owned houses. They had much, much lower expectations from their living standards than the young do now.

Young people now with good, marketable education, get on perfectly well, and can buy themselves a house and raise children. Those with less education, and/or less drive find it very hard. But I believe that they always did.

I have to agree, In the early '60's I went to a state university in what is now a "rust Belt" area. Summers I worked in factories and earned enough to pay for a year of college. My first four jobs, before I quit to go to law school ( on a G.I. Bill that paid over 100% of my tuition) were with Fortune 500 companies. When I was in my 20's I bought a new Corvette, for 3 months gross wages. I feel sorry for the youngsters and with AI it's only going to get worse.

Actually, I do not agree that the older generation had it relatively “easy”. The older generation had to go through wars, civil unrest, famine, migration and so on, let us not forget history. Yes times are tough but they were always tough. The older generation did not have the luxury of having access to instant information (internet, smart phones, etc.); they had to work hard to get the information they needed. Yes Debt is a problem, it has always been a problem since WW1 and in some cases even since prior. The older generation never made an issue out of it and kept on going. The main problem with today’ generation is “Too Much” information and to try and filter it through is not easy, actually it is a real challenge even to the ones who generated it in the first place.

To be clear, the younger generation's life or prosperity trajectory is deteriorating, meaning that they start with what their middle-class parents are able to provide. It's also true for up to 30-35 year old people, I believe.

This is not a matter of "the older had it easy" or "the older are to blame" --quite the opposite: the younger are to blame, but are in a tight spot, because of the spiritual legacy of the older.

For example, we have a cultural expectation that ...money will grow! This allows our current market, monetary and banking systems to exacerbate inequality. At the same time, the older generation believed that hard work will be rewarded and better days will come and was verified about this, because of the industrial revolution needing labor. Current reality is much different: the technology revolution needs more and more "special skills" and "innovation". Even people like Stiglitz believe that we can build "a learning society". Do you know that only 7% of the global population have college education? Do you think we can get this to more than 25%, under the best of open-market circumstances? How many classmates do you remember in high-school that you could call "clever"?

It is not the case that the older generation had a better life than the younger --by no means; quite the opposite. But, the older generation had an improving life trajectory and the younger are having --and will have-- a deteriorating one. The older generation had much more equality --inside borders-- and a fair world was close enough to demand it. Demanding a fair world is miles away for the younger generation. Fighting in wars was another reason that older generations would demand their rights; as for the luck of the younger generation not to have wars, Solon said "nobody's luck praise before the end".

The younger generation has the expectation to work on things they like, something all older generations almost never thought of. But that is how they have raised their children and now it is very difficult to understand the younger generation's disenchantment with what they have. They consider them lucky, but they should not, as more and more difficult days are coming our way...

@MM - of course the the older generation is responsible for every single bit of wealth inherited by the current generation - and they in turn owe a great deal to the previous generation. The issue is one of structural inequality and not one of generational blame. Purely by virtue that they were there first the top 1% older generation own the bulk of shares in in the most lucrative industries and a substantial portion of land. They pass this on to their heirs creating something similar to the medieval system of nobility (born into wealth) with the horrible side effect of stagnating capital and demand.

Jose, if the older generation or indeed the new generation could predict accurately the future, things would (be) / have been totally different. No one is perfect. To blame it all on the old generation is fundamentally wrong.

Steve, one should not deny the old generation the credit for laying down the foundations for the current generation, albeit financial, civic, etc. One can argue or debate the soundness of these foundations and propose alternatives but without these foundations the new generation would have had nothing to build upon.

You cannot create wealth if you have no job. You cannot make any plan of long term investment if you have no job security. Long term investment is the only route to wealth for most people. You mistake operating within the boundary of expectation with operating on the margins, you are also talking it would seem from the position of an asset buffer from your tone. If so then well done. There is however a psychological difference with the view of life with security and without security. At the extremes - with wealth and therefore security thoughts turn to humanitarian action and without security thought turns to the basics of what to eat and were to sleep which dominate the entire days thought process. The holders of what in fact is largely opportunistic unearned wealth do not want to share and are prepared collectively to see their offspring disenfranchised which is quite bizarre. I have seen first hand the effect of joblessness then a low wage unsecure part time labour based job with someone with a tech MSc who eventually gained a tech job and is a high performer. Incidentally nobody will invest in education and skill training unless there is a prospect. The disenfranchising of youth is unprecidented and the most dangerous situation facing society. Stilgitz is right, there is anger about, and I would add the older quartile is in denial

Michael, Allow me to disagree with you on this occasion. Putting aside for a minute all economic arguments, who in your opinion generated prosperity in the last decade or so? The new generation or the old one? It was the hard work and perseverance for change (through civil disobedience, civil unrest, wars, etc.) of the old generation that created or at least contributed in generating the wealth of today. When people from the old generation go out to a restaurant for dinning, they engage in discussions, they talk to one another. The new generation, they would barely speak to one another. They would be constantly looking at the screen of their smart phones. Observe it.

It's the Trustworthiness Gap. The author touched on this vis-a-vis the the lack of any whiff of accountability for the financial crisis (by either side). Maybe younger voters are a little more ruthless when holding politicians accountable - not having given in to the possibility that the occupation rewards ambition more than integrity.

The most optimistic may even believe that a political system can be built that yokes the innate ambition of persons (natural and otherwise) to create a crude approximation of integrity -- a noble but unattainable goal, like trying to achieve zero crime, or making automobiles completely safe.

You are, maybe, forgetting that it is not the industrial revolution anymore and that workers are divided in dozens of ways, not least by skills and the skilled are, usually, not bothered by inequality...

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